Many people in the UK were keenly interested in Wednesday’s budget announcement. For some it might have brought relief, for others, more uncertainty. From extending furlough, to offering more help to home buyers and freezing tax thresholds, employees may be left wondering how the budget will affect them financially and what their future job security looks like. HR professionals and business leaders can take a proactive approach to supporting their employees through this, providing reassurance where they can, and signposting them to other support as needed.
Employees whose furlough is being extended, or those being furloughed for the first time, (due to the Government’s decision to allow furlough up to the end of September), may have concerns about job security. They might worry that their furlough is a precursor to redundancy, or be concerned about their finances if their employer hasn’t topped up their furlough payments to reach 100% of their normal salary.
These are challenging worries for HR to support their workforce through. Businesses are still facing a lot of uncertainty and it might be difficult to provide reassurance to staff. In this scenario, HR can work with business leaders to understand what can be communicated to staff, and to encourage leadership to be as transparent as possible. HR can also let staff know that they should raise any concerns they have, including financial hardship, so HR and the business have a chance to address this on a case-by-case basis.
HR also has a role to play in ensuring the business adheres to furlough rules. Numerous stories have come to light about employers asking furloughed employees to work when they shouldn’t. Aside from the obvious compliance issues that breaking the rules raises, it may also cause your employees unnecessary stress and make them feel very uncomfortable. HR needs to continually reiterate the furlough rules to managers, and make it easy for employees to speak up if their manager is pressuring them to work when they shouldn’t be.
In reference to the budget, the Government states: ‘A new mortgage guarantee scheme will enable all UK homebuyers secure [sic] a mortgage up to £600,000 with a 5% deposit.’ For employees who are interested in buying a home, this may increase their mortgage options. And for those looking to sell, it might be easier to find a buyer and therefore may be a good time to put their property on the market. So, HR and line managers should be aware that it may mean that a number of employees could be going through the home buying/selling process this year.
Moving house is stressful at the best of times. Doing it after a year of COVID-19 restrictions might be especially trying for employees who are already struggling with their mental health. HR and payroll can help by making it as easy as possible for employees to access the employment-related information they need for a mortgage application. Having good HR systems in place will make this a quicker process for all involved.
To further support employees selling and buying homes this year, HR could also set up workspaces with HR software like Cezanne HR, for employees to discuss their experiences with each other. While it isn’t work related, employees may appreciate the support, and it’s another chance for people to engage and connect with each other – this is especially important if colleagues aren’t seeing each other face to face.
Freezing income tax thresholds
Some employees may be disappointed by the Government’s decision concerning, ‘Maintaining the income tax Personal Allowance and higher rate threshold from April 2022 until April 2026.’ HR can lead on the front foot with this by making sure all affected employees understand what the decision means for their take-home pay, signposting employees to further Government information if needed.
A lot of organisations already have advice in place to help employees who may be struggling financially. If it’s not been reviewed over the last year, now would be a good time for HR to revisit the support they offer employees experiencing financial hardship. Exploring with business leaders if there is any additional help the business could offer, and communicating to staff that you’ve undergone this process, will show employees that help is available if they are having financial worries.
This article is not to be construed as advice. Please seek independent help if you would like to learn more about how the budget affects you or your particular employees.
For more information on the points discussed above, you may wish to view: